KARACHI: AGP Limited reported a 16% year-on-year drop in sales to Rs4.68 billion in the second quarter of calendar year 2026.
The decline stemmed from weaker local sale volumes and subdued exports, according to a research note by Optimus Capital.
Cost Controls Keep Earnings Nearly Flat
Quarterly sales also fell 32% from the preceding quarter’s Rs6.85 billion.
For the first half of 2026, sales stood at Rs11.53 billion, down 9% from Rs12.72 billion a year earlier.
Despite the sharp top-line contraction, profit after tax attributable to company owners declined only 3% year-on-year to Rs601 million.
Earnings per share came in at Rs2.15. The company also declared a dividend of Rs2 per share for the quarter.
Gross profit stood at Rs2.86 billion. Gross margin improved 2.6 percentage points to 61.2%.
The margin expansion was supported by price increases, a higher share of non-essential medicines, and a 21% reduction in cost of sales through vendor negotiations.
Operating profit fell 25% year-on-year to Rs1 billion.
Finance cost eased 5% to Rs344 million, helped by a Rs2.3 billion reduction in long-term debt.
Tax expense plunged 83% to Rs47 million. The effective tax rate dropped to 7.4%, linked to losses at OBS subsidiaries.
Analysts said further clarification on the tax position is awaited.
Sales Expected To Remain Under Pressure
Optimus noted that sales are expected to remain under pressure through the rest of 2026.
The main drag is subdued exports linked to the Afghan border closure.
Commercialisation in other export destinations is projected to begin in 2027.
The company also plans additional marketing and manufacturing contracts.
Consolidation of OBS Pharma and NCI’s shareholding in OBS AGP and OBS Pak is seen as a potential source of further upside.
In the first half, profit attributable to owners was almost unchanged at Rs1.46 billion against Rs1.47 billion a year earlier.
The results highlight ongoing volume challenges in both domestic and export markets for the pharmaceutical firm.